Drone Aviation Holding Corp Completes $4 Million Investment and Exchange

Company Completes Conversion of Outstanding Preferred Shares

Nov. 23, 2015 8:30 am

JACKSONVILLE, FL--(Marketwired - Nov 23, 2015) - Drone Aviation Holding Corp. (OTCQB: DRNE) (OTCQB: DRNED) (the "Company"), a developer of specialized lighter-than-air aerostats and tethered drones, today announced that it has completed a $3.725 million offering of its common stock and has exchanged its outstanding shares of Series B-1 Preferred Stock, with a liquidation value of $275,000, for shares of common stock. Frost Gamma Investments Trust, an affiliated entity of Dr. Phillip Frost, Chairman of the Company's Strategic Advisory Board, Jay Nussbaum, Chairman of the Board, and members of the Company's senior management collectively invested $3,050,000 in the offering.

The Company sold an aggregate of 745,000 shares of its common stock to accredited investors at a purchase price of $5.00 per share and exchanged 68,731 shares of Series B-1 Preferred Stock for 55,000 shares of common stock for an aggregate of 800,000 common shares issued. In conjunction with the closing of the offering, certain holders of the Company's outstanding shares of Series A, B, C, D, E, F and G Preferred Stock have converted their shares into common stock (subject to ownership limitations) at their respective governing conversion ratios currently in effect and holders of the Series A, B, C, and D Preferred Stock have entered into lockup agreements restricting sales of those shares for six months from the closing date of the offering. 

Dougherty & Company LLC acted as the sole placement agent in connection with the offering.

The Company intends to utilize a portion of the proceeds of this capital raise to launch production and sales and marketing efforts of its new WATT line of electric tethered drones. The WATT electric tethered drone is able to stay connected to the ground via an armored tether system for secure long endurance flight. The WATT hardware and software systems are based on years of experience from delivering tethered aerostat systems to various U.S. Government and Army customers. WATT was created to gather real-time, broadcast quality video footage for a wide range of commercial applications including newsgathering, emergency first responder/search and rescue, military and border protection.

Mr. Nussbaum stated, "The completion of this investment lead by Dr. Frost, myself and my senior staff is an important milestone for our company as we are now financially prepared to produce and market our tethered drones for commercial and government use. Additionally, we were able to execute on our strategic plan to improve our capital structure through the conversion and lockup of the most of the Company's outstanding preferred shares as we continue to build for the future."

About Drone Aviation Holding Corp.
Drone Aviation Holding Corp. (DRNE) develops and manufactures cost-effective, compact and rapidly deployable aerial platforms including lighter-than-air aerostats and electric-powered drones designed to provide government and commercial customers with enhanced surveillance and communication capabilities. Utilizing a proprietary tether system, the Company's products are designed to provide prolonged operational duration capabilities combined with improved reliability, uniquely fulfilling critical requirements in military, law enforcement and commercial and industrial applications. For more information about Drone Aviation Holding Corp. please visit www.DroneAviationCorp.com or view our reports and filings with the Securities and Exchange Commission on http://www.sec.gov, including the Risk Factors included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2014, as well as information about the Company in our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

Forward-Looking Statements
This press release contains projections of future results and other forward-looking statements that involve a number of risks and uncertainties and are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Important factors that may cause actual results and outcomes to differ materially from those contained in the projections and forward-looking statements included in this press release are described in our publicly filed reports. Factors that could cause these differences include, but are not limited to, the acceptance of our products, lack of revenue growth, failure to realize profitability, inability to raise capital and market conditions that negatively affect the market price of our common stock. The Company disclaims any responsibility to update any forward-looking statements.

November 23, 2015 - 8:30 AM EST

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